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Inland Revenue has produced QB24/02 which looks at how the new bright line rules apply if you rent out a room to a flatmate.Answer: if more than 50% of the land, for most of the bright line period, is able to be used by the owner as their dwelling then the main home exclusion will apply.There could be situations where the person’s residence is their home but this is incidental to the carrying on of a rental activity, which would not qualify for the exemption.QB 24/02 goes on to explain assumptions made and expand on this conclusion to give you a clearer idea of where the boundaries lie.It includes comments along these lines:Renting to cover living costs suggests it is your main home, while renting purely for profit leans the other way.If you occupy a significant area (inclusive of common area) of the house for your own use this favours the conclusion it is your main home.A large number of flatmates might suggest your rental activity is more of a business and therefore the house is not your main home. All these factors need to be considered together to determine this.